Choose the one most appropriate answer for each.
-a law signed in 1989 which provided a sweeping revision of the regulatory authorities governing savings and loans
A)alienation clause
B)automated underwriting systems
C)computerized loan origination
D)disintermediation
E)due-on-sale clause
F)Fannie Mae
G)Farmer Mac
H)Fiat money
I)FIRREA
J)Freddie Mac
K)Ginnie Mae
L)mortgage broker
M)mortgage company
N)mortgage-backed securities
O)municipal bonds
P)participation certificates
Q)prepayment penalty
R)primary market
S)secondary mortgage market
T)usury

Question

Quizplus · Accepted Answer

FIRREA (Financial Institutions Reform, Recovery, and Enforcement Act) was a law signed in 1989 which aimed to address the savings and loan crisis by providing a sweeping revision of the regulatory authorities governing savings and loans.

Answer: S
 The secondary mortgage market involves the buying and selling of existing mortgages, which allows lenders to obtain funds to originate new loans. It was significantly impacted by the FIRREA law.

Answer: F
 Fannie Mae, also known as the Federal National Mortgage Association, is a government-sponsored enterprise created to expand the flow of mortgage money by creating a secondary mortgage market. It was established prior to FIRREA but also impacted by the law.

Answer: J
 Freddie Mac, or the Federal Home Loan Mortgage Corporation, is another government-sponsored enterprise created to expand the flow of mortgage money by providing a secondary market for conventional mortgages. It was also impacted by FIRREA.

Answer: N
 Mortgage-backed securities are securities that are backed by the cash flows from a pool of mortgages, allowing investors to participate in the mortgage market. The creation of these securities was impacted by FIRREA.

Choose the One Most Appropriate Answer for Each